Schrödinger’s Capital: All labor is necessary so long as someone pays for it?
NOTE 18: Is there a material limit to socially necessary labor time?
The charts I introduced in my last note on the value-form school raises an interesting question. If the charts provide two different measures of value — one drawn from Marx’s labor theory of value, the other drawn from value-form theory — they also provide two different measures of socially necessary labor time. If this is true, which measure of necessary labor time is accurate?
Let me restate Arthur’s argument this way: What we today call value is a mental abstraction that only develops after the emergence of money. Commodities do not have a common attribute called value; rather, our practice of attaching prices to commodities creates the notion they have value. We act on commodities as if they have value and thus “posit the presupposition” they are values.
Since value is a manifestation of the socially necessary labor times required for production of commodities, does money also determined social production times as well?
According to Arthur, one problem with Marx’s assumption that labor creates value is that labor itself does not uniformly transform into a currency. If we could show that a given quantity of labor uniformly translated into a given quantity of currency, we could say labor directly accounted for the relative values of commodities. In fact, the values of commodities are actually measured in units of a money, not some duration of labor.
And how does this inversion of Marx’s argument affect the notion of socially necessary labor time as the measure of the magnitude of the value of a commodity? According to Arthur, if we accepted the argument that value is measured by some duration of labor time, the thesis the magnitude of value is determined by socially necessary labor time would be a tautology: it simply means labor time is determined by labor time.
Money determines what labor is socially necessary
The value-form school, therefore, begins with the assumption money itself accounts for the notion of both value and socially necessary labor time:
“It is difficult but necessary to grasp the inversion of the ‘naturalistic’ paradigm required by the ‘purely social’ determination of value forms. In a naturalistic paradigm measure is a human intervention into already constituted dimensions and relations of determination, whether through immediate comparison or an indirect one. But in the case of the purely social substance, value, it is the social practice of commensuration in exchange that posits what is presupposed in such measure, a homogeneous value dimension. Money serves at the same
time as incarnation of the measurable (value) and standard of the measure (one dollar). In its measuring function, money acts as origin of the value dimension itself.
“The unity of commodities as values is secured only in their common relation to money. Money is not therefore a measure of value, it is the form of value as measure. Only through this coordination are commodities situated in a value dimension, and hence only through the mediation of money may such social aspects of commodities as their representation of abstract socially necessary labour be secured. It is not that the commodities themselves have a common value dimension subsequently given a metric by money. It is our practice of pricing commodities that creates this value dimension ideally. Social practice posits the presupposition.”
According to Arthur, it makes no sense to speak of the value of a commodity in isolation from exchange, because values are always determined by comparing the labor time of one commodity to another. Thus, we do not know if the labor time expended to produce a commodity is socially necessary until after money has been paid for it.
At risk of simplifying Arthur, then, the money paid in a transaction ‘secures’ the commodity as the ‘representation’ of abstract socially necessary labor. The question, of course, is what Arthur means by “secures” and “representation”.
Arthur could have bluntly stated, “All labor is socially necessary if its product is sold in the market.” Any expenditure of labor only proves itself to be socially necessary if the laborer can find a buyer for his product.
Conversely, if this was not what Arthur meant, he could have stated: “I do not here intend to imply labor is socially necessary simply because the product of labor has been sold.” He could have admitted that some products of labor, like all products of nature, can be sold in the market even if these products have no value at all.
That Arthur never makes the latter argument would appear to imply he thinks a product of labor has value and represents socially necessary labor time anytime it can find a buyer in the market.
Money capital and socially necessary labor time
Arthur concludes his 2003 paper by arguing money generates such notions as socially necessary labour time by determining to what degree actual labour times are socially valid. In 2012, Arthur makes his argument explicit: Although in Marx’s Capital it appears there is a separate stage of production based on exchange value existing prior to capitalism, in fact this “simple commodity production” stage did not exist.
In Capital, Marx argues from the first that labor power is the source of value; however, for the value-form school, labor power only becomes the “carrier” of value once it too becomes a commodity. The term “carrier” is to be distinguished from the term “source” because labor power does not actually create value; rather, it transmits (we could say labor “transfers” or “conveys” the valorization process, perhaps) value through the production process much like constant capital in Marx’s theory.
“[Just] as value is borne by material commodities so the abstract activity of value-positing is carried by living labour in general.”
The useful qualities of the commodity is not its value and, in the same way, useful labor is not value creation, but carries it. Unlike Marx, who spoke of the two-fold character of one and the same act of labor, Arthur argues the valorization process is distinct from the labor process.
“If value is ontologically distinct from use value, albeit consubstantial with it in the commodity, then the process of valorisation is also distinct from the labour that carries it.”
The ambiguity of value-form theory
The theoretical ambiguity of this argument can be seen if we introduce the assumption that the workers, “live on air and hence did not have to work for themselves at all” as Marx wryly put it. In my version of this thought experiment, we assume an economy where all production has been automated and thus set wages to zero. This would produce one of two outcomes:
Outcome One: If the valorization process is distinct from the actual labor process that carries it, it should not matter if there is any living labor expended in the production process at all. Capitals will continue to produce value so long as there is production of use values.
Outcome Two: Since in Arthur’s argument labor is the “carrier” of the valorization process, some expenditure of labor is always necessary for valorization. No matter what the technical need for labor to produce use values, the valorization process necessarily requires living labor to function as the carrier of the valorization process. The capitalistic mode of production remains dependent on the expenditure of living labor to carry the process of valorization despite the fact it technically no longer needs labor to produce commodities.
In any case, it is unclear from Arthur’s 2012 paper, which of these two outcomes is necessary in the value-form argument: A valorization process that can continue without living labor or a valorization process that requires labor even if it is technically unnecessary. In both his 2003 and 2012 papers, Arthur seems to imply the valorization process requires living labor even if it is technically unnecessary.
In 2003, for instance, Arthur says, “In this light it has been argued that form-determinations structure such notions as socially necessary labour time”. For some reason, Arthur throws in the term “notion”, so his argument remains ambiguous. It is unclear whether socially necessary labor time is itself determined by the value-form or if money merely determines the “notion” of socially necessary labor time? And if it is only the latter, it remains unclear whether Arthur believes labor actually must be present to “carry” the valorization process even if it is not technically necessary?
In 2012, however, Arthur makes another, less ambiguous argument:
“New value cannot be generated all at once, but takes time, because living labour takes time to produce what has value.”
Here, Arthur seems to assume the technical need for labor to produce use values (bearers of value) can never fall to zero. However, if this is possible and thus no living labor is expended to produce use values, what happens to the valorization process? The valorization process must require an extension of the labor day, despite the fact it is not materially necessary:
“In sum capital is a totality of value-in-process, and when it totalises the living labours it exploits, it determines each as the carrier of its own predicate: the time it takes.”
Is socially necessary labor time determined by capital?
What Arthur has done is not simply invert “the usual understanding of the relation between form and matter”, now socially necessary labor time is not determined by the technical capacities of society, but by the needs of the valorization process. That this argument violates the law of value will be news to no one, not even Arthur.
Arthur’s argument implies the inevitability of a growing gap between the technical and the social requirements of production. Properly understood, the technical requirement for labor must tend to decrease over time with each improvement in the productivity of social labor; yet, at the same time, the social requirement for labor will tend to increase with each increase in the productivity of social labor.
I will look at this contradiction next.